The last twelve months, like the past few years, have been financially very difficult for many households across the UK. Continued freezes on wages coupled with soaring living costs have resulted in more and more people finding themselves in the difficult situation of being unable to make ends meet. This, in turn, has led to many households finding themselves sinking even deeper into debt.

According to one recent report, families in the UK have increased their levels of personal debt by a whopping 48 percent over the past year, with the average family now owing £7944 compared to £5360 a year ago. The figures related to unsecured debt only and were released by the leading insurance firm, Aviva. Whilst on average there has been a slight increase in household net income over the past year, despite the pay freezes that many individuals are facing, the average household unsecured debt has still increased.

There has also been an increase in the number of families that are not saving any money each month, which has increased to a record high of 42 percent in the past twelve months. This further reflects the financial difficulties that many households are facing. The amount being put aside by households that are able to save some money each month fell from £22 per month in January 2011 to £21 for January 2012.

An official from Aviva said: “Families in the UK are still very concerned by the rising cost of living and levels of unemployment. While average incomes have increased over the past year, the prices of essential goods and services have also increased, meaning that families are struggling to keep up. Many appear to have acclimatised to this economic environment by shopping around and seeking to minimise their spending in certain areas. However, at the same time there are still a worrying number of families with insufficient savings or large debts.”